J Sainsbury yesterday defied the growing economic gloom by posting profits of £272m in the first half of the year, a gain of 13%, as consumers traded down from more upmarket chains.

Justin King, chief executive, said the supermarket had been "bang on the money" when it decided in the autumn last year to revamp its own-label range and run a campaign encouraging customers to save money by switching from more expensive brands. The campaign began two months ago just as the financial crisis moved into overdrive.

King said: "All grocers are grappling with customers' massively changing behaviour." Sales of Sainsbury's expanded no-fuss Basics range are running 25% ahead of last year. "The reality is that we have seen [standalone] brands push through price increases, and 'own label' is better value than ever," he said.

Almost 33% of Sainsbury's products are on special offer, compared with 25% a year ago.

The chain reported a like-for-like sales increase of 3.9%, and King said he aimed to maintain that level of growth next year. That confidence is in stark contrast to Tesco, which last month cut its internal sales growth forecasts from 3-4% to 2%, anticipating the worsening economy.

Shares in Sainsbury closed 7.5p higher at 279.75p. In a note to clients, JP Morgan analyst Alastair Johnston described the results as boring, but added: "But boring is good in these markets."

King said the changes made over four years during the supermarket's recovery programme had made it more resilient. He said the breadth of products available, from Sainsbury's upmarket Taste the Difference brand, to its Basics range, meant customers were able to choose to trade down on some products without having to go and shop elsewhere.

Six out of 10 customers would put some items from the Basics range in their baskets. "Those customers may also be buying from our Taste the Difference range. It is a misunderstanding to think customers only buy one or the other."

At the same time, said King, the chain was taking customers from more expensive retailers such as Marks & Spencer and Waitrose, which do not offer cheaper options. "We think we are the logical place for those customers," he said.

Market-share figures published by the retail analyst TNS this week show Tesco losing 0.4% share compared to last year and Waitrose losing 0.2%. J Sainsbury fell a more modest 0.1% to 15.9%. Asda, which trades heavily on price, increased its share from 16.7% to 17.1%, as did the discounters Aldi, which now has 3% of the market, and Lidl, which has 2.3%.

"Surveys of customer sentiment are as downbeat as they have ever been since at least 10 years. But the perception is significantly worse than reality. They fear what is coming - but today, they are still able to make ends meet," King said.

King said that food inflation had eased month-on-month and forecast it would continue to fall in the near term, although prices are still significantly ahead of last year. Stripping out the impact of inflation, like-for-like volume growth is around 1%, the company said, in line with the market. Total sales were up 7.6% at £10.8bn.

King said the company had offset some of the higher food prices by reducing costs; there is no plan for major redundancies. Instead it is pressing on with its capital expenditure plans and intends to aggressively expand its convenience store format, opening 50 stores in 2009/10 and another 100 in the following year.

Online sales were up 30% in the period and customer orders are 100,000 a week.